Open up all sectors, Ramaphosa told
• Union federations at Nedlac want the government to get cracking on fixing the economy and ending the lockdown
The country’s patience is wearing thin and decisive action has to be taken to immediately open and fix the crashed economy, organised labour warned President Cyril Ramaphosa on Thursday. The president met the National Economic Development and Labour Council on Thursday amid growing pressure to completely open the economy as entire sectors are still halted from doing business. Job losses are soaring as a result of the strict lockdown imposed to curb the spread of the coronavirus.
The country’s patience is wearing thin and decisive action has to be taken to immediately open and fix the crashed economy, organised labour warned President Cyril Ramaphosa on Thursday.
The president met the National Economic Development and Labour Council (Nedlac) on Thursday amid growing pressure to completely open up the economy as entire sectors are still halted from doing business. Job losses are soaring as a result of the strict lockdown imposed to curb the spread of the coronavirus.
The months-long lockdown has left the tourism and hospitality industries gutted, while the tobacco and alcohol industries have been brought to a complete halt for the greater part of the lockdown, which has been in effect since the end of March.
In Thursday’s meeting, the labour sector told Ramaphosa that the lockdown needed to end for the embattled economy to recover from Covid-19.
TURN THE TIDE
“The public is losing patience rapidly and they expect to see decisive action,” Matthew Parks, Cosatu’s parliamentary coordinator, said about its blunt message to Ramaphosa.
Ramaphosa was told that he needed to turn the tide against the struggling economy, which is projected to contract 7% in 2020, and that there was an “urgent need” to open it up.
The meeting, which was attended by government, business, labour and community leaders, discussed measures aimed at ushering in economic recovery and reconstruction, and included the Treasury’s economic reconstruction, recovery and growth plan.
The Treasury has once again proposed infrastructure development, reforming state-owned enterprises and increasing the ease of doing business, to aid economic recovery.
The economic recovery plan also shone the spotlight on the decline in trade and investment, with exports and imports down R50.43bn and R12.87bn, respectively, when compared with April 2019.
The Treasury’s plan proposes tax holidays and tax relief for people and businesses in “vulnerable sectors”. It also identifies infrastructure development projects on water, roads, rail and ports as vehicles with which to grow the economy.
Cas Coovadia, CEO of Business Unity SA, said the meeting did not go into detailed discussions on any of the economic plans presented, but went “quite well”.
“I think everybody understood that we are in a situation of crisis and that we need to urgently move on an economic recovery strategy.”
He said the meeting agreed to put together a small, senior team in the next couple of days that would look at the various documents on the table to make headway on an economic recovery strategy for the country in the next three weeks. The team would then report back to the president.
Parks said that while it would have a significant effect if the government implemented all of its recovery plans, there was a lot of scepticism about its capacity to implement everything it committed to.
He said organised labour also raised the issue of the need to tackle corruption and to ensure that initiatives such as the president’s infrastructure programme did not become the “next centre of looting”.
Parks said the government could try its best to jump-start the economy but it would not make any progress if corruption and wasteful expenditure were not resolved, given the amount of money lost through this.
Modupi Maile, first deputy president for international affairs of the National Council of Trade Unions, said that by putting a complete ban on the sale of alcohol and cigarettes, the government was redirecting consumers to the illicit market and that diverted revenue away from the SA Revenue Service.
“We told the president that the economy must be opened up completely or risk further job losses, which will lead to poverty entrenchment,” said Maile.
“We said to the president ‘we are now sick and tired of this festival of documents you always present’, because we have not seen any implementation. All we want is a pragmatic intervention focused on saving jobs while ensuring economic growth.”
Riefdah Ajam, general secretary of the Federation of Unions of SA, also said there was an urgent need for the economy to open up. “We’ve seen so many sectors being on their knees, bleeding,” she said.
She said the tourism and hospitality sector, faced with the loss of more than 400,000 jobs due to the Covid-19 pandemic, needed to be prioritised.
The sector has lost about R54bn so far and is set to lose another R80.2bn in foreignexchange receipts that would have been generated between May and December, according to government data.
Ajam said the government had lots of grand plans, “but what we need is urgent implementation, otherwise it’s going to be same old, same old”.
The Presidency said on Thursday in a statement that social partners had agreed on the need to identify priority interventions and act “urgently to move the economy forward”. They had also agreed that the fight against corruption must be intensified to ensure that wrongdoing did not undermine efforts aimed at economic recovery. “Consensus is emerging on what to do to achieve economic recovery, transformation, inclusive growth and globally competitive economy,” the statement said.
“To deepen consensus and advance to action, Nedlac constituencies will nominate senior leadership to serve on a team that will over the next three weeks draw up a set of priority actions for economic reconstruction and the institutional arrangements to support these actions.”
The team will present Nedlac and the president with an economic recovery action plan that will be “submitted to cabinet for endorsement”.
WE SAID TO THE PRESIDENT ‘WE ARE NOW SICK AND TIRED OF THIS FESTIVAL OF DOCUMENTS YOU ALWAYS PRESENT’
THE MEETING AGREED TO PUT TOGETHER A SMALL, SENIOR TEAM THAT WOULD LOOK AT THE VARIOUS DOCUMENTS ON THE TABLE